Administration Herøya Industripark AS

The ethane tank at INEOS will be ready for American gas in 2015

The world energy market is changing. Technological developments mean that INEOS in Bamble, Norway, can import American shale gas on long-term contracts at a significantly lower price than North Sea gas. Noretyl AS is building a 35,000 cubic metre tank to receive ethane shipments from the USA. The tank will be ready by the time the first ship arrives in mid 2015.

Magnar Bakke in front of the ethane tank which will be ready by the time the first ship arrives in mid 2015

“We have now secured a long-term and reliable supply of raw materials. This gives us a basis for investing NOK 300 million in a new cracker furnace. The raw materials situation also lies behind Ineos owner Jim Ratcliffe’s idea of investing NOK 4.2 billion in developing the plant at Bamble and making it one of the biggest petrochemical plants in Europe,” says Site Manager for INEOS Olefins & Polymers Norway, Magnar Bakke.

Gas contract until 2030Drilling technology developed in the North Sea has made it possible to extract large volumes of gas from shale beds previously viewed as uneconomical for large-scale extraction. The price of gas on the American market is much lower than in Europe, and INEOS has secured long-term contracts for gas deliveries to its petrochemical plants. The contract with the American gas supplier will run until 2030. The gas is cooled down to minus 100 degrees and transported in large specially built ships. In order to receive such large volumes of ethane gas, INEOS has had to build a new storage tank.

“We currently use 50 % ethane and 50 % LPG (propane) in our production. It has long been our aim to increase the proportion of ethane in the raw material. In the future we shall be able to use between 90 and 100 % ethane in our production, with the rest being LPG. This ethane gas will come to us from the USA”, Bakke explains.

First shipment in 2015The gas will also be stored in cooled condition. This puts high demands on the tank currently under construction. It is being built with an outer wall of 60 cm concrete and a steel inner tank. Insulation will fill the gap between these walls. The temperature in the tank will normally lie at minus 90 degrees. The tank will be connected to the factory with new pipelines. New pipes will also be laid between the tank and the quay.

“The outer tank is already complete. We are now working on welding the inner tank. At the end of the year the new tank will be put into operation with gas from Kårstø. The new tank has to be cooled, and for technical reasons we need to devote plenty of time to that. The plan is to receive the first shipment of ethane gas from the USA in the third quarter of 2015,” Bakke concludes.